The True Cost of a Bad Boss

There are only two kinds of bosses: those that support their teams and have a positive overall impact on productivity and those that do not. Unfortunately, a lot of U.S. bosses are just making work harder to do well. Today, nearly one-third of American employees report that they feel underappreciated by their direct supervisors. And a full 44% say that they've been verbally or even physically abused by a superior at some point in their careers.

The latest video from OnlineMBA breaks down the enormous cost of these horrible and not-so-great bosses. Between stress-related health expenses, productivity losses and the costs associated with high employee turnover rates, bad bosses are costing U.S. companies an estimated $360 billion each year.

We all know it isn't easy being the boss. How can you inspire someone who knows that it's your job to make sure they're doing theirs? Until bosses find some magic ability to lead with all the vision of Jack Donaghy and all the lovability of Leslie Knopes, workers and bosses will just have to keep living with each other.

Video Transcript

3 out of 4 working Americans say their boss is the most stressful part of their job - 44% say they've been verbally, emotionally, or physically abused by a supervisor or boss at some point in their career, and 31% of workers say their boss just doesn't appreciate them. Sounds like a big group of whiners, doesn't it? Actually, employees with subpar management have the right to complain - and this dissatisfaction is costing businesses and the American economy big money.

1. The Economy: Bad working relationships between management and employees costs the economy $360 billion each year from lost productivity. Fake sick days, dawdling because of low-motivation, and purposefully making mistakes out of spite are all direct results of a bad boss - and it costs the economy big bucks.
2. Health is at Stake: Anyone who has ever had a bad boss knows they can't just shake 'em off when they turn in their two weeks' notice. In fact, it takes people 22 months to restore their stress levels to a healthy range after a bout of terrible boss. Also, people who are stuck working for someone horrible are more susceptible to chronic stress, depression, and anxiety - which all increase the risk of a lowered immune system, colds, strokes, and even heart attacks. All those sick days and visits to the doctor, acupuncturist, massage therapist, and psychologist are costing companies a pretty penny in health costs and lost work days.
3. Last but not least, a bad boss produces some very real costs in the form of recruitment costs, lost productivity during new-hire training, and in cases that escalate - legal fees. One organization who did the math on real money lost in a year because of one boss's bad repertoire with employees added up a whopping $160,000 - well above the average managerial salary in many industries.